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May 29, 2025
Hawaii passes nation’s first climate change tourist tax
Hawaii’s Kilauea volcano spews stunning lava fountains
Hawaii’s Kilauea volcano spewed lava fountains exceeding 1,000 feet, according to the U.S. Geological Survey.
Hawaii became the first U.S. state to establish a climate impact fee on Tuesday, placing an additional tax on tourists to fund climate change resiliency projects and environmental stewardship within the islands.
As the country’s inaugural “Green Fee,” Act 96 will raise the state’s current transient accommodations tax (TAT) by 0.75% for a total of 11% placed upon the nightly lodging rate, effective Jan. 1, 2026, according to a press release by Governor Josh Green’s office.
The fee will apply to travelers staying in hotels, short-term vacation rentals and for the first time ever, cruise ships. For a nightly hotel rate of $300, that would be an extra $2.25 each night.
“As an island chain, Hawaii cannot wait for the next disaster to hit before taking action,” Green said in a statement. “We must build resiliency now, and the Green Fee will provide the necessary financing to ensure resources are available for our future.”
The new fee is expected to generate $100 million annually. The funded projects are to be confirmed next legislative session but will span environmental stewardship, climate and hazard resiliency, and sustainable tourism.
Previously, cruise ship passengers had bypassed the TAT, but the new law seeks to promote “equity across the tourism industry” by ensuring all travelers contribute to protecting the islands’ economic and natural resources.
The bill came as a response to the growing frequency of natural disasters exacerbated by climate change, specifically the 2023 Maui wildfires, the deadliest wildfire in the country in over a century that decimated the community of Lahaina. In just hours, over 100 people were killed with homes, businesses and cultural sites burnt to ashes.
After the fires, the governor formed the Climate Advisory Team (CAT) to develop climate disaster policy recommendations. A key measure from the group was to secure a source of funding for climate change mitigation and disaster relief, according to the release.
“The Green Fee bill marks a historic investment in climate disaster resilience and environmental protection,” said Chris Benjamin, the leader of CAT, in a statement. “Using the TAT to fund resiliency projects ensures that the financial burden of safeguarding our aina (island) and people doesn’t fall upon residents alone. We thank the legislature, industry and countless community groups and individuals who advocated tirelessly for this bill.”
Tourist taxes are quickly emerging worldwide as more destinations face the impacts of overtourism and climate change. Last year, Greece, Bali and the Galápagos Islands all implemented or raised their fees on travelers to contribute to various programs based on sustainability.
Experts say the effectiveness of such a tax is still up in the air and heavily depends on the outcome and goals. In some cases, like in Venice, a small tax hasn’t deterred tourists, but in other places, it has successfully funded beneficial projects.
